US Tethered to Iran Conflict by Invisible Chains of Global Energy Markets

The idea of the US disengaging from conflicts in Iran is appealing to politicians and voters alike, but it's not as simple as just 'wishing away' the issue.

The Strait of Hormuz, a narrow body of water that handles around 20% of the world's petroleum consumption, sits at the heart of the problem. Tankers carrying crude oil through this chokepoint are a major concern for global energy markets.

When tensions rise between Washington and Tehran, shipping insurance rates skyrocket, tankers slow down or change routes, and commodity speculators panic, causing crude oil prices to surge. This has a direct impact on consumers at the pump, with gasoline prices rising above $5 per gallon.

The US cannot afford to ignore this reality, as energy shocks have real-world consequences for voters and politicians alike. The idea of drilling our way out of trouble is also flawed, as crude oil is a globally priced commodity that doesn't care where it's produced, if global supply contracts, domestic prices will soar.